Why China Is Known For Its Labor

Some people think that business is all about making money by selling a certain product. At first, it may seem that way especially if you do not know anything about business are you are just starting out. This in itself is already a problem because when people start their business with just that concept in mind then there is already a huge risk of failing. When it comes to having your own business you would soon realize that there are far more things to consider that just selling your product and earning your money.

In setting the price of the product alone there are already a lot of factors to consider. In order to set the price of a product, you would have to consider the price of the competition in the market because it would be one of the detrimental factors why people will buy or why people will not buy the product.

When we talk about prices of products it is important to ask why for certain products in the same local market have different prices. When we talk about prices alone, of course, the cheaper product is, the easier it would be to sell. Then the question why are some products more expensive than their competition. One of the factors that cause price change among different products is how the product is made.

The process from material to final product has almost everything to do with how much the final product would sell in the market. Things to be considered in this process are the source of the materials, the manufacturing of the product and the kind of technology involved in the process. If you are able to find the right combination that would not compromise the quality and price then you have yourself a competitive product.

If we take a look at different products in the market we can see where that certain product is made and a lot of these we can see is made from China. Even if the company is based in the US or in Europe you can still see some that are made in China. From technology to garments and a lot of these products in the market are made in China.

The reason behind this is that the labor and the manufacturing process itself if done in China is a lot of cheaper due to the cost of labor and the fact that China has a lot of land for manufacturing plants and a lot of people to work in these plants. Because of this lower cost of labor in China, foreign companies are able to earn more from the savings made in these costs, aside from that Chinese manufacturing industry are also able to produce large volumes of different products.

There may be other countries that also have cheap labor but China has always been one of the leading countries when it comes to labor which is why a lot of companies especially from the US have their products manufactured in China. Today China seems to be having a lot of issues such as that with Japan and the Nanjing Massacre, territorial dispute and the rising cost of labor. Even if the cost of labor may still be cheaper compared to other countries if the cost of labor in China continues to raise this could me a big problem for the manufacturing industry.

Business relations among US-based companies and Chinese manufacturers could be cut if the US companies find another place that would be cheaper than China. In the end, it all depends on whether reforms would be able to help in the labor costs in China in order for them to remain as one of the well-known countries when it comes to the manufacturing business.